DUP seeks to cut taxes but not public spending
The DUP has proposed a tax cut for Northern Ireland companies — but with no reduction in public spending levels here to pay for it.
As the party unveiled its long awaited General Election manifesto yesterday, it said it was putting the economy centre stage, as it unveiling the 72-page document.
Its leader Peter Robinson said: “This is the first time in the history of the DUP we have been able to publish a manifesto that concentrated on the economy as the primary issue. This shows just how far we have come.”
Among the policy goals in the document is a reduction in corporation tax — a tax which is applied to company profits.
The DUP manifesto contains no costings for its measures, or specific proposals on how they would be funded.
It does call for savings to be made in areas like the number of quangos and government departments.
It says a corporation tax cut should not involve a “compensating reduction” from the block grant, the money the Assembly gets each year for its public expenditure programmes. The manifesto does not specifically spell out where the tax cut should apply.
But the DUP's Stormont Finance Minister Sammy Wilson yesterday told the Belfast Telegraph the demand was for a UK-wide change.
Mr Wilson also reiterated a warning he recently gave to the Assembly on the consequences of such a tax measure applying only here.
He said the Treasury would fund it by decreasing the block grant, leading to a loss of up to £400m “at a time when we are already struggling with cuts in the public sector”.
“The second thing is that the most immediate impact of it will be to give money to shareholders,” he added.
“There is no guarantee in the immediate period that it would translate itself into additional investment.”
Mr Wilson said these problems would not apply with a UK-wide tax cut.
The Conservative Party's manifesto, which was launched last week, includes a feasibility study on a corporation tax decrease in Northern Ireland.